Decline in Q4 revenue by 21% surpasses product codes and suppliers

Revamped Rant:

Beyond is slimming down its product offerings and vendors as its sales keep plummeting, as revealed during a recent earnings call. In November, Beyond axed over 6 million SKUs and eliminated 800 vendors, with an additional million SKUs whacked off the roster in December, according to President Dave Nielsen.
The retail giant's fourth-quarter revenue tanked by 21% to hit $303 million, while the yearly revenue took a 10.6% hit, as reported in their press release. The company ended Q4 with a $43 million operating loss and a whopping $81 million net loss. For the entire year, operating loss amounted to $191 million, and net loss reached $259 million.
Beyond hinted earlier this month that they're exploring new financial, insurance, and personal record-keeping opportunities via tokenization and creating a blockchain-based consumer service for storing sensitive info like financial and estate planning records securely.

In-depth Grumbling:

Beyond's Executive Chair, Marcus Lemonis, offered investors and analysts a blunt reality check on what to expect from the company's performance for the rest of the year. He hinted that there might be months where they're close to achieving profitability, but he's not betting on profitability for the entire year.

Their efforts include streamlining the retail industry by cutting down on SKUs and vendors, addressing friction points in the Overstock experience, and tying up with an unnamed tech partner to overhaul the site experience and responsiveness.

Beyond reported 5.4 million active customers, a 4% year-over-year decrease, and 1.7 million orders delivered, a 34% plunge. Despite the drop, the average order value during the quarter soared almost 20% to $181 from $151 the prior year.

According to Jefferies analysts led by Jonathan Matuszewski, there's a bias towards growth in the coming quarters, mainly due to the ramp-up of recently acquired brands like Zulily and Buy Buy Baby, along with enhanced site merchandising due to SKU reallocation between Bed Bath and Overstock. However, if Beyond persists in dedicating a significant chunk of its sales to advertising— as it did during December— they might experience stagnation in customer growth as profitability becomes the priority.

Although Beyond's performance has faltered in recent periods, Lemonis stated during the call that "this is the rock-bottom shitshow we've been through, ladies and gentlemen, and I guarantee you that the worst is, without a shadow of a doubt, 100% behind us, under the current conditions." The company has been on a shopping spree over the last year, sealing deals that expanded its brand portfolio.

Last March, it snapped up the intellectual property and brand assets of Zulily for a paltry $4.5 million. This month, it finalized a strategic partnership with Kirkland's, which involves opening a few physical stores under the Bed Bath & Beyond banner. The move marks the return of the brand name to brick-and-mortar stores for the first time since their 2023 bankruptcy. On Monday, the company confirmed it closed the deal to purchase BuyBuy Baby for $5 million.

However, the results have been utterly un-fucking-impressive following these acquisitions, according to Neil Saunders, managing director of GlobalData. He claims that Beyond's brands lack consumer awareness, curation, exclusivity, and a valuable proposition.

While Beyond's moves in cutting SKUs and vendors are headed in the right direction (and helped reduce losses), "these adjustments are still desperately far from guaranteeing success," Saunders explained. "They're about as engaging as watching paint dry."

With the aim of improving profitability, Beyond is taking drastic measures, including reducing SKUs and vendors, as hinted by Marcus Lemonis in a recent earnings call.
Beyond's exploration of tokenization and blockchain technology for financial, insurance, and personal record-keeping could potentially transform their business and finance sectors in 2023.
Despite the reduction in SKUs and vendors, Beyond's performance in recent periods has been lackluster, according to analysts at GlobalData, with their brands being criticized for having low consumer awareness and limited exclusivity.
In the coming quarters, Beyond is expected to see growth due to the integration of recently acquired brands like Zulily and Buy Buy Baby, but continued heavy advertising spending could hinder customer growth as profitability becomes the priority.
Beyond's technology partner, yet to be named, will play a crucial role in revamping the company's site experience and responsiveness, aiming to streamline the retail industry and create a more seamless shopping experience for global customers.